XML 29 R18.htm IDEA: XBRL DOCUMENT
v3.21.2

COMMITMENTS AND CONTINGENCIES | 9 Months Ended
--- | ---
Sep. 30, 2021
Commitments and Contingencies Disclosure [Abstract] |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases office facilities under noncancelable operating leases that expire on various dates through 2032, some of which may include options to extend the leases for up to 12 years. The components of lease expense are presented as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2021 |  | 2020 |  | 2021 |  | 2020 |  |
| (In thousands)
Operating lease costs | $ | 1,684 |  |  | $ | 1,274 |  |  | $ | 5,130 |  |  | $ | 3,776 |  |  |
The components of lease liabilities are presented as follows:
| September 30, 2021 |  | December 31, 2020
| (In thousands)
Operating lease liabilities, current (Accrued liabilities) | $ | 4,261 |  |  | $ | 4,542 |
Operating lease liabilities, noncurrent (Other liabilities) | 12,492 |  |  | 15,209 |
Total operating lease liabilities | $ | 16,753 |  |  | $ | 19,751 |
Supplemental lease information: |  |  |
Weighted average remaining lease term | 6.0 years |  | 6.4 years
Weighted average discount rate | 7.5% |  | 7.7%
Supplemental cash flow and other information related to operating leases, are as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2021 |  | 2020 |  | 2021 |  | 2020 |  |
| (In thousands)
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |  |  |  |
Operating cash flows from operating leases | $ | 1,529 |  |  | $ | 1,252 |  |  | $ | 4,315 |  |  | $ | 3,411 |  |  |
Non-cash investing activities: |  |  |  |  |  |  |  |  |
Lease liabilities arising from obtaining right-of-use assets | $ | 437 |  |  | $ | 3,798 |  |  | $ | 437 |  |  | $ | 6,739 |  |  |
Undiscounted cash flows of operating lease liabilities as of September 30, 2021 are as follows:
| Lease Amounts
| (In thousands)
Year: |
2021 (remaining three months) | $ | 1,540 |
2022 | 4,729 |
2023 | 4,108 |
2024 | 3,141 |
2025 | 2,363 |
2026 and thereafter | 4,018 |
Total lease payments | 19,899 |
Less: imputed lease interest | (3,146) |
Total lease liabilities | $ | 16,753 |
Purchase Obligations The Company has contractual obligations related to component inventory that its contract manufacturers procure on its behalf in accordance with its production forecast as well as other inventory related purchase commitments. As of September 30, 2021, these purchase obligations totaled approximately $247.5 million. Litigation The Company is subject to various legal proceedings relating to claims arising out of its operations that have not been fully resolved. The outcome of litigation is inherently uncertain. If one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s business, results of operations, financial position and cash flows for that reporting period could be materially adversely affected. As of October 26, 2021, the Company is not currently a party to any matters that management expects will have an adverse material effect on the Company’s condensed consolidated financial position, results of operations or cash flows. Contingencies On March 26, 2020, the Office of the United States Trade Representative (the “USTR”) announced certain exclusion requests related to tariffs on Chinese imported microinverter products that fit the dimensions and weight limits within a Section 301 Tariff exclusion under U.S. note 20(ss)(40) to subchapter III of chapter 99 of the Harmonized Tariff Schedule of the United States (the “Tariff Exclusion”). The Tariff Exclusion applies to covered products under the China Section 301 Tariff Actions (“Section 301 Tariffs”) taken by the USTR exported from China to the United States from September 24, 2018 until August 7, 2020. Accordingly, the Company sought refunds totaling approximately $38.9 million plus approximately $0.6 million accrued interest on tariffs previously paid from September 24, 2018 to March 31, 2020 for certain microinverters that qualify for the Tariff Exclusion. The refund request was subject to review and approval by the U.S. Customs and Border Protection; therefore, the Company assessed the probable loss recovery in the year ended December 31, 2020 was equal to the approved refund requests available to the Company. As of December 31, 2020, the Company had received $24.8 million of tariff refunds and accrued for the remaining $14.7 million tariff refunds that were approved, however, not yet received on or before December 31, 2020. As of March 31, 2021, the Company received the remaining $14.7 million tariff refunds. For the year ended December 31, 2020, the Company recorded $38.9 million as a reduction to cost of revenues in the Company’s condensed consolidated statement of operations as the approved refunds relate to paid tariffs previously recorded to cost of revenues, therefore, the Company recorded the corresponding approved tariff refunds as credits to cost of revenues in the fourth quarter of 2020. For the year ended December 31, 2020, the Company recorded the $0.6 million accrued interest as interest income in the condensed consolidated statement of operations. The tariff refund receivable of zero and $14.7 million was recorded as a reduction of accounts payable to Flex Ltd. and affiliates (“Flex”), the Company’s manufacturing partner and the importer of record who will first receive the tariff refunds, on the Company’s condensed consolidated balance sheet as of September 30, 2021 and December 31, 2020, respectively. The Tariff Exclusion expired on August 7, 2020 and those microinverter products now are subject to tariffs. The Company also continues to pay Section 301 Tariffs on its storage and communication products and other accessories imported from China which are not subject to the Tariff Exclusion.

X
- References No definition available. + Details
Name: | us-gaap_CommitmentsAndContingenciesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for commitments and contingencies. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 450 -URI http://asc.fasb.org/topic&trid=2127136 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 440 -URI http://asc.fasb.org/topic&trid=2144648 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 954 -SubTopic 440 -Section 50 -Paragraph 1 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6491277&loc=d3e6429-115629 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 440 -SubTopic 10 -Section 50 -Paragraph 4 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=123406679&loc=d3e25336-109308 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 440 -SubTopic 10 -Section 50 -Paragraph 4 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123406679&loc=d3e25336-109308 + Details
Name: | us-gaap_CommitmentsAndContingenciesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration